Monday, October 27, 2014

Brace for Impact

She said,

"Sir, as you are seated at the emergency exit row, you'll be responsible to open the emergency hatch. It weighs 15kg and when you hear the announcement 'Evacuate...Evacuate...Evacuate...', please pull the handle down, lift the door and throw it out.

Will you be able to do that?"

For a brief moment, I hesitated.

It sounded like a huge responsibility. Then, I took a moment to look at the extra legroom surrounding me, and I said,

"Yes, I can do that..."

*****

It is easy to sit down in front of your screen, pop up an excel spreadsheet and key in the numbers that will lead to your early retirement.

In fact, my spreadsheet tells me that I'll be financially independent in about 10 years or less.

While I'd like to imagine this journey towards financial freedom as a smooth one where I consistently dump a thousand or two every month for the next 10 years, and live off the dividends till the end of time, I have to say that this thought is straddling the boundaries of hopeful idealism and childlike naivety.

In reality, it's not that straightforward.

One moment everything looks good - you feel confident.

Next moment, the seat belt sign is turned on, your seat rattles uncontrollably and you keep peeking at the emergency hatch on your right - silently trying to figure out how it works.

Likewise, family emergencies may pop up, you may decide to get married, there might be a funeral or a child may be on the way. Each of these events have the capability to wipe out your entire savings and reduce you to square one again. (That's why you need to have an emergency bucket)

Alternatively, opportunities arise and you may need to sink in some seed funding to leverage on them. Are you prepared for the risks? Are you willing to divert from your initial plan?

*****

"Let's not kid ourselves, there will be turbulence."

If you're not prepared for the risks, you can always take the seats at the back, buckle your seat belts, struggle through the ride and retire at 65.